A characteristic clinical feature of dengue virus infection is thrombocytopenia, though its underlying mechanism is not definitively determined. By adoptive transfer of human CD34(+) fetal liver cells into immunodeficient mice, we have constructed humanized mice with significant levels of human platelets, monocytes/macrophages, and hepatocytes. Infection of these mice with both lab-adapted and clinical strains of dengue virus induces characteristic human hematological changes, including transient leukopenia and thrombocytopenia. We show that the specific depletion of human platelets is not mediated by antibodies in the periphery or reduced production of human thrombopoietin in the liver but reduction of human megakaryocytes and megakaryocyte progenitors in the bone marrow of the infected mice. These findings identify inhibition of platelet production in the bone marrow as a key mechanism underlying dengue-induced thrombocytopenia and suggest the utility of the improved humanized mouse model in studying dengue virus infection and pathogenesis in a human cell context.